After many, many hours of work by Legislative Council Ordinance Chair Ryan Knapp and his colleagues, several information forums on the proposal, and a sparsely attended public hearing, the full council unanimously approved an upgraded senior tax relief program May 7.
One aspect of the new ordinance will take effect immediately, activating a component providing up to $800 in tax relief to several dozen qualifying applicants in a newly established income tier this year. The balance of the ordinance’s new tenants will go into effect beginning with the 2015 round of tax relief applications.
During a 7 pm public hearing Wednesday night, former CPA and IRS agent Lou Polonkay was highly critical of several changes to the ordinance. He argued that the ordinance included language disallowing any deduction of losses in determining one’s qualifying household income.
“Losses are permitted for federal tax purposes; they are permitted for the State of Connecticut purposes; why is Newtown taking such a restrictive view in eliminating all losses?” he asked.
Mr Polonkay also pointed out that the ordinance does not go far enough in qualifying how applicants identify assets in a newly drafted asset affidavit that will be required beginning in 2015. He read from proposed language that would permit an applicant from excluding their primary residents and the possessions within it as part of the asset cap.
“Does that eliminate my car because it is in the garage? Does that eliminate my wife’s jewelry because it’s in the house? Does it eliminate bonds in a safety deposit box in my closet? These are very vague and open-ended statements that can be confusing and cause a lot of conflict,” Mr Polonkay said.
Resident Michelle Assante told the council she believes it is unfair to provide a relief program that does not require proof that applicants require such assistance.
“The proposed ordinance change both raises the adjusted income limit to $70,000 allowing many reductions to that adjusted income,” she said, “which essentially means an applicant may have an adjusted income that far exceeds $70,000 per year.”
Ms Assante said coupling that requirement with no verified asset test hampers the ordinance from providing assistance to those who may be most in need.
“It’s not fair to target financial assistance that is going to come on the backs of other taxpayers. It is not fair especially since we’re not going to truly assess the need of those who are participating,” she added.
Margaret Daley confessed to the council that she and her husband are putting their home on the market because local taxes have become unaffordable. She said the couple would prefer not having to move, but the current level of taxation is forcing them out.
But she acknowledged that enhancements to the tax relief program might make enough of a difference to permit them to remain in town.
She also asked if additional tax relief programs like those offered to military veterans would become void if they apply for the local Newtown program. Later, during the full council session, Town Finance Director Robert Tait confirmed that local relief applicants could still apply for and qualify to receive other state or federal benefits including credit for military service.
Jane Calverley was the final resident to speak on the matter, saying she does not like the proposed asset test. Ms Calverley said she and her husband have spent their lives being thrifty.
“I think it’s wrong to look at assets just because we’ve made straw for the future,” she said. Pointing out that neighboring Ridgefield has a tax relief program that automatically includes all residents once they reach a qualifying age without any specific restrictions or conditions, Ms Calverley closed saying, “I hope Newtown does a program without asset inspection.”
During full council deliberation on the matter, Vice Chair Neil Chaudhary motioned the ordinance to include several nonsubstantive changes that moved the extended 2014 application deadline of June 15 to June 1, to accommodate the tax collector’s office. The proposal was also amended to incorporate language including medical expense deductions beginning with the 2015 application period.
Council member Lisa Romano questioned how the town would define applicants’ assets, and expressed concern about any inventory of applicants’ assets that might be accessible as part of “the public record.”
Mr Knapp said there were others who expressed the same concern during several information forums he attended in recent weeks. He assured the council and those attending that the asset affidavit stipulations and the cap for qualifying are still subject to discussion even if the council endorsed the ordinance.
He reviewed language in the ordinance text that stipulated the council would not be required to set asset requirements until as late as September 30.
Council Chair Mary Ann Jacob said she would be bringing the tax collector into the conversation about asset verification and the cap, as discussions on that aspect of the relief program continue into the summer.
Councilman George Ferguson said he did not like the asset test provision, and he reserved the right to move the council strike any asset-related provisions if the panel could not agree on satisfactory standards.
Councilman Robert Merola reminded his colleagues that Newtown’s senior tax program already is among the most generous in the state. First Selectman Pat Llodra asserted that only Redding’s tax relief program exceeds the generosity of Newtown’s at the current $1.65 million level.
With a unanimous roll call vote, the council then endorsed the plan.